Growing Need for Circular Economy

The global population will hit 10 billion by 2050. Meanwhile, the world’s natural Resources are being used at an ever-increasing pace– making it critical for us to find sustainable new ways to make (and re-make) our products. It’s not just an environmental matter, but also a matter of economic sustainability – both in terms of resource efficiency and cost reduction. Society is currently using resources equivalent to 1.7 planets each year. Where are those extra 0.7 planets coming from?

The term "Circular economy" is not new, though it has gained popularity now. The central concept was born in the year 1988. If we look from a bird's point of view, we have 3 types of economy. Linear economy-which follows a procure-produce-dispose technique in the economy where natural resources are at cost. The second would be, Reuse linear economy, where we follow a procure-produce-reuse-dispose technique and more emphasis is given on reusing products.

The third type, Circular Economy, is where the procure-produce-recycle-procure technique is used and disposable material is reduced close to 100%. For many years, we have used the first type of economy. Still, we ought to keep in mind that with a rising population, the waste generated is double the population, which is harmful to the human race and the idea of sustainability. Recently, the idea and concept of regeneration and restoration have been highlighted by superpowers of the world like Germany, Singapore, and other countries in the EU. But we should keep in mind that the transition of moving from a linear economy to a circular economy will be impossible without the coordination and cooperation of other developing nations. With the advent of sustainability in almost every industry, business, and economy, most countries from different unions are trying to transition to the Circular Economy.

Speaking in layman's language, a Circular economy is an economy aimed at reducing the creation of wastage by using necessary activities and initiatives. In a Circular Economy, the resources are used in a continuous process by implementing methods like recycling, reusing, and refurbishing. It is an attempt to save resources in this finite world to have sustainability in the long term.

How can we transit from Liner economy to Circular economy?

This question could also be a substitute for the benefits & needs of CE to us. First and foremost, to help prevent the excess supply of finite raw materials because it also manifests an increase in dependency on other countries resulting in causing disequilibrium in the BOP (Balance of Payment) of a country. The second reason would be, Promoting Decarbonization. Adopting a Circular economy will prevent GHG emission, as it uses renewable sources of energy that are far safer than fossil fuels in the long run. The third point is inclined towards corporate strategies and implementation of ESG criteria in their operations. ESG (Environment, Social, andGovernance) is a set of protocols that gauges the management behavior of any company on how it involves social and environmental strategies into its corporation. ESG, in general, is a vast concept involving people and encouraging them to reduce food & beverage wastage. It involves ESG investing, where the stakeholders invest in companies that have successfully implemented ESG in their operations. Another substitute for ESG would be CSR activities.

Application of CE in Food and Beverage Industry

According to an article written by Holle Secon on Greenbiz, an estimated 1.3 billion metric tons of food —about one-third of all the food produced for human consumption — is lost or wasted each year globally. Technology and different optimization techniques should be used at manufacturing units, reuse raw materials more than once, and increase the ingredient's value by reprocessing food products. Food containers must be biodegradable, use of plastics and other polythene products should be banned. Instead, the use of jute bags or paper bags must be promoted. Leaders of this industry should, on a collective basis, develop multiple pathways to tackle this problem and lead this circular economy initiative.

Application of CE in Supply Chain & Logistics

The chain will remain similar to a linear economy, having a supplier, a producer, a distributor, and a consumer. But in a circular economy, after the product is used, it moves back in the chain to produce. This concept is called 'replace and purchase.' Companies like Amazon, Flipkart, and Walmart are persistently behind this concept. Billions and millions of dollars are put into setting up Reverse Logistics in their supply chain. We could also start giving "Renewed" tags to the products. The tag renewed means it is a second-hand refurbished product and could be 'reused' till the utility is complete 0. This will give a marginal edge to the circular economy, where products are re-engineered and supplied according to the needs at lower prices. According to USEPA, the United States Environmental Protection Agency, 29% of greenhouse gases are released by the transportation sector, which is more than electricity. Resources shall be made available to every supply chain and logistics company. In the end, it's a collective process and not an individual process.

Implementation of CE within Built Environment

Built Environment or Concrete Jungles refers to a man-made environment used for setting human activity. The construction and infrastructure industry is growing at an alarming rate, and it is also identified as the world's largest consumer of raw materials (source: In a built environment, we have jotted down many problems, like 15% wastage of raw material during construction of buildings, loss of finite energy resources, unethical practices, which lead to a rise in disposal rate. Using the principles of CE, we increase the lifecycle of infrastructural assets. Government and Policymakers should create stringent policies for construction and infrastructural companies to build zero-energy buildings and use renewable sources of energy wherever required. The use of solar panels, water harvesting systems, and waste decomposition systems must be an integral part of the built environment in a Circular Economy.

There will be hurdles while transiting the entire economy, but we should always think for the long term and weigh down the pros the circular economy has to offer. Start implementing now, one step at a time, because time is the value of money.